Are SDOH the New Medicare, MA Market Opportunity?

What makes us healthy

Once a fringe concept, social determinants of health (SDOH) have moved to the forefront of healthcare in recent years, with everyone from the Centers for Medicare and Medicaid Services (CMS) to Congress to private insurers acknowledging their role in improving health outcomes. Payers, in particular, have taken bold steps to address social determinants of health by forging innovative partnerships with providers and community organizations, such as Aetna and CVS Health’s new social care network. Their social care network will allow Medicaid and dual-eligible beneficiaries to more easily access help from social care providers within their communities. While the industry works to address interoperability barriers that prevent data sharing at scale, these early partnerships aim to demonstrate the outcomes that are possible when social determinant data is taken into consideration.

This trend is particularly important for Medicare and Medicare Advantage (MA) enrollees, who are statistically more likely to have at least one SDOH challenge, such as housing insecurity, social isolation or transportation barriers, among others. These socioeconomic and demographic factors highlight the importance of health plans monitoring and providing benefits for non-medical needs – particularly in MA’s value-based reimbursement model, where payers and providers share financial responsibility for health outcomes. The good news is that in April 2019, CMS finalized a rule giving MA plans regulatory flexibility to cover benefits that address SDOH, such as covering the cost of fresh produce for beneficiaries with cardiovascular conditions or carpet cleaning for those with asthma.

These SDOH benefits don’t just help improve outcomes, they lower costs, as well. For example, a recent report from the Bipartisan Policy Center showed that Medicare could save $1.57 for every dollar spent delivering free healthy meals to seniors after a hospitalization. The meal benefit would cost about $101M a year but could avoid $158M in bills from return trips to the hospital – a net savings of $57M. 

Clearly, connecting vulnerable patients with community resources is a win-win for everyone and helps achieve healthcare’s “Triple Aim.” Patients enjoy better outcomes and an improved care experience, providers are set up for success with value-based reimbursements, and payers benefit from lower costs. Care coordination that incorporates SDOH is easier said than done, however, with interoperability challenges often standing in the way of a holistic patient record that integrates claims, clinical and social determinant data. HealthEdge’s HealthRules CareManager offers a 360-degree view of a member so that care managers, providers and community organizations can work together to provide care coordination that incorporates social determinant data.

As enrollment in value-based plans such as Medicare Advantage continues to accelerate, particularly among increasingly tech-savvy baby boomers who have come to expect a better, more personalized care experience, payers are facing an enormous market opportunity. Forward-thinking health insurers who want to attract and retain MA members in the years ahead are modernizing their technology infrastructure to support care coordination that incorporates social determinants of health.

As a payer organization, are you ready to capitalize on the MA market opportunity? If not, it may be time to prioritize social determinants of health.


Subscribe to The 'Edge Report Blog